Reliance Jio’s Entry Has Led to a Series of Mergers & Acquisitions in the Indian Telecom Industry. Voice Tariffs Are Close to Zero While Data Is Getting Cheaper by the Day. A Close Look at What the 4G Battle Could Mean for Telecom Subscribers. By Manu Kaushik
It’s a high stakes war to dominate India’s ₹2.6 lakh crore telecom sector. A corporate fight as brutal, intense, debilitating and bruising as that seen in the cash-guzzling e-commerce business. Indeed, the giants in both these sectors are involved in a game of one-upmanship for customer acquisition through attractive freebies which are burning a hole in their balance sheets. But that’s where the comparison ends, and the contrast begins. On every parameter, the telecom clash dwarfs the e-commerce battle: telecom has seen an investment of ₹9.27 lakh crore against about ₹71,000 crore in e-commerce; it employs 4 million against 0.35 million in e-commerce and its debt burden of ₹3.81 lakh crore is next only to the power sector in India. And, it’s a no holds barred contest in telecom for another reason. The winner will actually lord over the most precious commodity of the future: DATA.
Little wonder then that the incumbents Airtel, Vodafone, Idea Cellular and Tata Tele services, besides Reliance Communications (RCom) and BSNL/MTNL, have taken on the challenge thrown by the Mukesh Ambani-owned Reliance Industries’ bold and disruptive ₹2,00,000 crore telecom play, Reliance Jio. Retreating is not even an option. All the large players have invested between $15-20 billion besides raising a debt pile of between ₹50,000 crore to ₹1 lakh crore.
This story is from the April 23, 2017 edition of Business Today.
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This story is from the April 23, 2017 edition of Business Today.
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